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Associated Press, Published September 28 2010

Bismarck bank sues defunct mortgage lender

BISMARCK, N.D. (AP) — A Bismarck bank is trying to recover more than $26 million it claims it lost to a defunct Arizona mortgage lender.

The Bismarck Tribune reports that BNC National Bank filed a complaint in an Arizona court in June alleging fraud by American Mortgage Specialists.

BNC's lawsuit alleges American Mortgage Specialists diverted the bank's money and gave the false financial statements and other reports about loans BNC was investing in.

Arizona regulators revoked the mortgage lender's broker license in June and the company has shut down.

Dave Hoekstra, BNC's president for its North Dakota operations, says the bank is insured and remains profitable and financially sound.

Copyright 2010 The Associated Press.